Enterprise Resource Planning and Management

What is enterprise resource management?

Enterprise resource management (ERM) is the process of managing a company’s resources to make sure everything is used effectively. Unlike an enterprise resource planning system (ERP) that handles a wide range of business functions through various ERP modules, enterprise resource management focuses on organizing and preparing each resource. It’s a simpler way to keep your business moving without a full ERP deployment.

ERP software vs. ERP system

What is enterprise resource planning software? ERP software refers to the tools a business can use to consolidate its various working parts and manage them successfully. ERP software is often used interchangeably with ERP system. However, the latter can incorporate lots of different areas of business and processes — and an integrated software solution can make automating and streamlining these processes much easier.  

History of ERP

How did we get from piles of paperwork to the powerful ERP systems we use today? Well, as you know, ERP stands for enterprise resource planning — but it all started with material requirements planning (MRP) in the 1960s. Back then, MRP helped manufacturers manage production and inventory without relying on stacks of paperwork. By the 1990s, ERP evolved to bring together other business functions like accounts payable and procurements into one management system.

Components of an ERP system

What makes up an ERP system? Let’s break it down. Most ERP applications come with core modules that handle different parts of a business, making it easy to keep everything connected. 

Here are some of the core modules you’ll find:

• Finance and accounting: This module helps manage budgets, expenses, and financial reporting.  
• Inventory management: The inventory module tracks orders and helps with resource utilization.
• Human resources: HR modules track employee information and manage payroll. 
• Production planning: This module helps manage production schedules, materials, and the overall manufacturing supply chain.
• Sales and marketing: The sales module tracks leads, manages orders, and analyzes customer data.  

Note: Some businesses might add specialized modules, especially if they use modern ERP solutions for flexibility.

Types of ERP systems

Choosing the right ERP software system depends on your business needs, budget, and tech setup. Here’s a simple guide to help you understand the different types:

Cloud ERP 

This type of ERP is hosted on the internet, or “cloud.” The easiest way to understand this is to think of it as online storage for managing business. Since it’s based in the cloud, you can access your ERP anywhere with an internet connection.

Cloud ERPs are managed and updated by the software provider, so you don’t have to worry about keeping the system up to date. It’s popular for companies looking for flexibility and lower upfront costs.

On-premise ERP 

With on-premise ERP, the software is installed directly on your company’s computers and servers in your office. This type of ERP gives you more control over your data and security, which is why some companies prefer it. 

However, it requires a dedicated IT team to manage updates, security, and other technical issues.  

Hybrid ERP 

This is a mix of cloud and on-premise ERP, also known as two-tier ERP. You might have your core ERP functions on-premise (in your office) for better control while using cloud ERP for certain functions or in separate locations. 

This setup can be useful for large companies with multiple offices or businesses wanting flexibility while keeping certain data close to home.

Open-source ERP 

Open-source ERP systems are free to use and customizable. This means you can access the ERP’s code and modify it to fit your needs. It’s a great option if you want more control and are more tech-savvy. 

However, you might need an experienced developer to handle the customization and setup. Since it’s open source, there are often no licensing fees, but you’ll need to manage updates and security on your own.

Legacy ERP 

This refers to older ERP systems that have existed for many years. Some businesses still use legacy ERP systems like Oracle E-Business Suite and SAP R/3 because they are deeply integrated into their operations. 

These systems can be harder to update and may lack modern features like cloud access. Companies using legacy ERP systems sometimes face challenges when it comes to ERP integration with newer technology.

What are the benefits of ERP for businesses?

The advantages of ERP for your business can be huge. An enterprise resource planning and management system helps businesses: 

• Reduce the time spent on manual tasks
• Save costs by cutting down on wasted resources
• Keep track of finances, from expenses to revenue, all in one place
• Gain a clearer view of operations, making it easier to track performance
• Enhance collaboration by connecting departments through shared data
• Protect sensitive information and ensure only authorized users have access
• Boost employee productivity by automating processes, allowing your team to focus on higher-impact projects

If your business needs a work management system that brings everyone together, Wrike could be the perfect solution. Instead of having a scattered workflow, Wrike organizes everything in one central place so teams know where to find information and updates.

You can also use Wrike’s OKR tools to provide real-time insights into your budget, goals, and spending. This helps teams track progress and manage budgets effectively, ensuring resources are used wisely. 

How to implement an ERP solution

Implementing an ERP solution can be a big project but, with the right approach, it doesn’t have to be overwhelming. Here are some best practices to follow: 

Build your ERP team 

Start by forming a team with representatives from each department. This group will oversee the ERP implementation and ensure that all departments’ needs are considered, whether it’s ERP integration with current tools or improving specific processes in areas like the manufacturing system.

Document current processes 

Map out your existing workflows and pinpoint any areas with bottlenecks or outdated methods, like a paper-based manufacturing system for production. Knowing where your current system falls short helps you identify where the ERP can add the most value and streamline operations.

Prioritize training 

A smooth transition to ERP requires that your team is well prepared. Offer training specific to each department’s needs and address any resistance early on. Change management is key to successful business ERP adoption.

Run a pilot test

Instead of a company-wide launch, start with a pilot test in one department. This allows you to catch any issues and make adjustments before a full ERP deployment. A phased approach also helps your team adjust gradually and minimizes disruption.

Choosing the right ERP software

There are many factors to consider when choosing ERP software for your business. Here are some questions to ask yourself before choosing which one is for you.

1. What are my business requirements from an ERP?

You may first ask yourself if your business even really needs ERP software. But if you are looking to grow and stand against your competitors in a challenging market, ERP software is a no-brainer for helping you achieve your goals. Ask yourself: 

• What do you need from your ERP? 
• Do you need advanced ERP technology that supports complex operations? 
• Which model for ERP aligns best with your goals?

All of these will depend on the size of your business, your industry, your pain points, and where you need help to streamline and scale processes. Spend time speaking with your team and researching what an ideal ERP software would look like to you.

2. How ready is my business to implement an ERP?

If you have never used ERP software before, it can be a huge change and may upset some of your team members. Implementing a new software system is never easy, and it’s important to remain transparent as you move through the process of choosing an ERP. Here are a few questions to consider:

• Have I communicated the benefits of ERP to my team?
• Is my team prepared to adapt to new processes?
• What support will they need during the transition?

Let your team know what will be expected of them, the processes they may need to learn, and where they can go should they have any problems or questions.

3. Is this ERP tailored to my business needs?

According to the Project Management Institute (PMI), four of the five major ERP vendors have developed project management applications within their ERP systems. As you begin to look at your ERP software options, be sure to schedule some demos and calls with an experienced ERP vendor. 

Ensure you ask questions to know if all of your ideal features are present. Choose a vendor that understands and supports your business needs — you don’t want a generic sales pitch without any tailoring to your company.

What trends are shaping modern ERP?

How is enterprise resource planning evolving as new technologies change how businesses operate? Here are five key trends shaping the future of ERP:

AI and machine learning 

Artificial intelligence (AI) and machine learning are adding smart capabilities to ERP systems. With these technologies, business ERP solutions can now:

• Forecast trends
• Automate repetitive tasks
• Analyze large amounts of data
• Make data-driven decisions accurately

For example, you can use Wrike’s AI-powered Work Intelligence® solution to predict risks and reduce manual tasks. This makes project management faster, allowing your teams to save time for more high-value activities.  

Cloud deployment

Cloud-based ERPs continue to rise in popularity because of their flexibility and scalability. With cloud deployment options, businesses can access their ERP data from anywhere, making it easier for teams to collaborate remotely. This trend especially benefits small business ERP users, who often prefer cloud solutions for their lower upfront costs and easy setup.

Data security  

Data protection is a top priority for all businesses. Modern ERPs come with advanced features like:

• Multifactor authentication
• Encryption
• Access control
• Audit trails
• Data masking

All of these features help to protect sensitive data. For businesses prioritizing security, Wrike provides enterprise-grade security to safeguard sensitive data and ensure secure collaboration. This level of security is important for companies handling complex workflows and confidential data.

Internet of things (IoT) 

According to Statista, the number of IoT devices globally is projected to nearly double in the next few years, rising from 15.9 billion in 2023 to 32.1 billion by 2030. 

IoT connects ERP systems to real-time data from physical devices. For instance, IoT sensors on equipment can send real-time data to the ERP, allowing for proactive maintenance and resource management. This integration helps businesses monitor assets closely and improve efficiency.

Ditch traditional ERPs for an all-in-one work solution

Now that we’ve explored ERP systems, if you’re looking for an all-in-one work management solution for your enterprise, Wrike has the tools you need to keep everything connected.  

Wrike goes beyond traditional ERP and brings all your teams together in one place. From task automation and customizable dashboards to real-time reporting, Wrike helps teams work more efficiently, stay aligned, and make data-driven decisions — all within a single platform.

Our work management automation software is designed for the ultimate performance, scalability, and reliability. Explore Wrike’s enterprise tools today.